How to get your customers to return: the peak-end rule
Part one: focus on the peak and the end
Successful retailers have one thing in common: They provide a great customer experience, and it doesn’t matter if their focus is eCommerce, physical stores, or a combination of both. But do you know how customers form their opinion about you? Naturally, it’s based on their experiences. If you’ve been able to serve them well, they’ll stay with you. If you’re able to make them love you, they’ll become advocates. Loyalty and advocacy, however, aren’t guaranteed and don’t come without consistency and commitment to brand promises, meaning you must earn and maintain their trust.
How are you doing? Just ask your customers
How do you know what makes your customers “click” with you? You need to ask them. Bear in mind, though, that it matters when, where, what and how you ask them. We’ll address all of that here, but before we do that, it’s important to first consider how the mind works when people form opinions about experiences and brands.
Perceptions are based on emotions
You’ve likely heard the classic adage by Maya Angelou: “At the end of the day people won’t remember what you said or did, they will remember how you made them feel.” Perceptions are based on emotions, and how people felt when interacting with your brand mainly influences how they value an experience.
It is also important to consider that opinions and memories are formed based on the peak-end rule In short, the peak-end rule is a cognitive bias in which an experience is evaluated and remembered based on the peak (most intense) point of the experience and/or the ending of the experience., It is also a key component in the behavioral economics discipline – a framework to understand how human decision-making might be driven by other than purely rational reasons.
This knowledge can help guide retailers to decide what questions should be asked to take the right actions to drive customer satisfaction.
It’s good to also mention that even if the peak experience was negative, you can still positively impact the customer’s perception by helping them have positive end experience – a practice often seen in the service sector and in retail. Let’s look at a few examples of how different industries positively impact the end experience:
- Restaurants often offer something for free at the end of a meal when delivering the bill, usually a sweet or a surprise dish. One restaurant that specialized in garlic dishes gave their customers herb shots on the house. This was not only a tasty surprise, but it helped to remove the smell of garlic from the breath.
- Grocery stores and other retailers often provide discount coupons as people leave the store or after an online purchase. The main intent is to get returning customers, but it also leads to a positive emotional impact at the same time.
- Many car maintenance services wash the cars before returning them to the owners, leading to a happier end-experience.
- Some large grocery store chains automate their end experience. For example, instant discounts to loyal customers when they scan their member card at check-out. It’s a great way to make people happier as they leave the shop.
- Additionally, frontline staff can strongly contribute to both the peak and end experience by how they interact with and serve customers. Even just a smile or a friendly comment can make a world of difference towards a positive experience!
What’s more important: customer experience or price?
A couple of these examples concern pricing and discounts. We often hear that customer experience is becoming more important than price, however, pricing, payments, and the use of discounts are incremental parts of the experience.
The important point here is that by providing a great experience, including how you price, contribute to having customers return and building customer loyalty. Loyal customers are more likely to spend a bit more with you rather than desert you for a competitor.
The customer journey is not one path. Plus, it’s a cycle
These days you’re being judged on how you appear and serve customers both online and in-person. The customer journey doesn’t stop once a product is sold, or delivered, or used- not even when it is recycled! In fact, the customer journey is a cycle, made up of continuous moments of engagement.
What’s more, the customer journey has become more multi-faceted due to the many digital places where people, either directly or indirectly, engage with your business.
Altogether, it can seem overwhelming. How can you know where and when to ask customers how they feel? What do you ask them? Having a good compass to navigate this complex terrain is a necessity. And that compass to guide your decisions comes in the form of the voice of your customers.
The peak-end rule can help you to distinguish the moments and things that matter the most to your customers. You may also consider segmenting the customer journey into distinct ‘episodes’. Once you’ve done that, you can look at each episode and apply the peak-end rule to them. If you’re able to then measure the satisfaction for each episode you’ll be in a better position to identify how you can improve.
In part two, we’ll continue this discussion about how to measure satisfaction across the customer journey, and how HappyOrNot is the perfect solution to help.
Customer Success Director EMEA at HappyOrNot